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EUR / USD
GBP / USD
USD / JPY
USD / CAD
AUD / USD
NZD / USD
USD / CHF
AUD / JPY
AUD / NZD
EUR / CHF
EUR / GBP
EUR / JPY
GBP / JPY
By Christopher Romano  —  Mar 28 - 01:35 PM
  • EUR/USD hit 1.0775 on EBS in Europe's morning, NY opened near 1.0790

  • Pair neared 1.0820 after US yields US2YT=RR softened & US data released

  • USD/CNH pull back from high, equity gains & gold rally also buoyed EUR/USD

  • EUR/USD slid, sat just below 1.0800 late as yields, US$ firmed up again

  • Long lower wick formed on daily candle but pair sat below the daily cloud

  • Monthly gravestone doji candle, falling daily RSI are bearish signals

  • Japan March CPI Tokyo, US Feb. PCE are key risks for Friday

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Mar 28 - 01:30 PM

Synopsis:

HSBC forecasts that the European Central Bank (ECB) will maintain its key policy rates at 4.0% during the April 11 meeting, aligning with signals for a potential rate cut in June. Recent data, including decreases in headline and core inflation for February and mixed wage growth indicators, align with ECB expectations. Despite this, only significant deviations in the upcoming March inflation data might influence an earlier rate adjustment.

Key Points:

  • April Meeting Expectations: The ECB is likely to keep policy rates unchanged in April, considering the bank's previous hints at a more substantial data review by June. Christine Lagarde, ECB President, emphasized the importance of observing more comprehensive data before making adjustments.

  • March Inflation Data Impact: A significant divergence in the March inflation figures might trigger a debate on the pace of rate cuts. However, an uptick in inflation is anticipated due to seasonal effects and a shift in consumption patterns, making an April rate cut less likely.

  • Future Rate Cut Considerations: While an April rate adjustment seems off the table, the ECB's guidance in April could set the stage for potential rate cuts starting in June. The focus will likely shift towards the ECB's readiness for a July cut, contingent on inflation trends aligning with expectations.

Conclusion:

HSBC anticipates the ECB to hold steady on interest rates at its upcoming April meeting, with a strong indication of initiating rate cuts by June. Despite potential fluctuations in the March inflation data, the central bank's decision-making is poised to rely on a broader dataset, making significant policy shifts in April unlikely. Attention will increasingly turn towards the ECB's future meetings for cues on the pace and timing of rate adjustments, particularly the possibility of a July cut.

Source:
HSBC Research/Market Commentary
By Christopher Romano  —  Mar 28 - 11:50 AM
  • AUD/USD broke the daily cloud base, t-l off Feb. low overnight, 0.64855 hit

  • A sharp rally ensued however and the pair climbed back above both

  • A daily bull hammer candle formed after the pair hit a 3-week low

  • AUD/USD longs encouraged by the signal but bear signals still remain

  • Pair below 10-, 21-, 55- & 200-DMAs & monthly gravestone doji in place

  • Japan March CPI Tokyo, U.S. February PCE are key data risks Friday

  • Data may determine if today's break lower was false or not

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Mar 28 - 11:00 AM

Synopsis: Bank of America (BofA) reaffirms its bullish stance on EUR/USD, projecting the pair to reach 1.15 by the end of 2024, in contrast to the more conservative consensus forecast of 1.10 for this year and 1.14 by 2025. BofA's optimism stems from expectations of a weaker dollar driven by moderating inflation and anticipated Federal Reserve rate cuts, enabling a shift towards equilibrium in USD value.

Key Points:

  • Bullish on EUR/USD: BofA stands firm on its year-end target for EUR/USD at 1.15, anticipating most of the currency pair's appreciation to occur in the second half of the year. This outlook positions BofA above the current market consensus.

  • Consensus Comparison: The market consensus pegs EUR/USD at 1.10 for 2024, and 1.14 by 2025. BofA's forecast extends further, envisioning EUR/USD at at 1.15 by end of 2024 and 1.20 in 2025.

  • Unchanged Core USD Forecasts: BofA's broader forecasts for the USD against G10 currencies remain steady. The bank anticipates broad USD depreciation in 2024, fueled by declining inflation rates and anticipated monetary easing by the Fed.

  • EUR-CHF Adjustment: The only recent adjustment in BofA's currency forecasts was an uplift in EUR-CHF projections following the Swiss National Bank's unexpected decision to lower interest rates.

Conclusion: BofA's steadfast prediction for EUR/USD to appreciate significantly by the end of 2024 reflects a bullish divergence from the market consensus. The bank's expectations hinge on a broader theme of USD depreciation against G10 currencies, driven by moderating inflation and prospective rate cuts by the Federal Reserve. This outlook suggests a return towards a more balanced USD valuation as the year progresses, particularly in the latter half.

Source:
BofA Global Research
By Paul Spirgel  —  Mar 28 - 10:10 AM

GBP/USD remained anchored near the lower end of its recent 1.2576-1.2676 range in early NorAm trading, bounded loosely by 200-DMA support at 1.2590 and the daily cloud top resistance at 1.2663, and is likely to remain weak after soft UK GDP data and hawkish comments by the Fed's Christopher Waller.

The pound is also coming under slight pressure ahead of the upcoming Good Friday holiday, month and quarter-end and Friday's PCE data, as traders gravitate to the safety of the U.S. dollar.

With recent Fed musings indicating comfort with a high-for-longer policy path, UK data and central bank voting suggesting a less hawkish BoE policy path in 2024, this year's early GBP/USD highs by 1.29 are likely to cap cable as recent longs predicated on a BoE rate path relatively higher than the Fed are unwound.

While the pound is likely to remain on the backfoot amid soft UK data and reduced BoE rate expectations, GBP/USD's fall is likely to remain measured, assuming the BoE does not signal an overtly dovish rate tack while inflation remains considerably above target.

Below the recent trend low at 1.2576, support comes in at 1.2518, the Feb.
5 2024 low, and the Nov.
20 weekly low at 1.2448.

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Mar 28 - 10:00 AM

Synopsis:

MUFG observes a notable increase in verbal intervention from Japanese officials against the yen's recent weakness, contributing to a temporary stabilization of USD/JPY below the 152.00-level. The caution among market participants about the heightened risk of intervention, especially during the upcoming less liquid Easter holiday period, underscores the seriousness of Japan's stance on curbing speculative movements affecting the yen's value.

Key Points:

  • Intervention Warnings Amplify: Japanese officials have intensified their warnings against the yen's depreciation, emphasizing their readiness to counter excessive market movements. This has injected a degree of caution among traders, wary of potential intervention.

  • Joint Meeting Raises Alert: A recent joint meeting between the Ministry of Finance (MoF), Bank of Japan (BoJ), and Financial Services Agency (FSA) highlighted concerns over speculative forces driving the yen's decline. Vice Finance Minister for International Affairs Kanda's comments post-meeting underscored the view that recent yen weakness does not align with economic fundamentals.

  • Speculative Movements Under Scrutiny: Kanda's remarks pointedly criticized the speculative nature of the yen's recent movements, emphasizing the government's low tolerance for such activities and signaling a readiness to intervene should these trends persist.

Conclusion:

The recent escalation in verbal warnings from Japanese officials marks a significant moment in Japan's approach to managing the yen's value. By publicly acknowledging the potential for intervention, Japan is sending a clear message about its willingness to act against speculative pressures that diverge from economic fundamentals. This stance has introduced a new layer of caution in the forex market, particularly as traders navigate the uncertainties surrounding the Easter holiday period.

Source:
MUFG Research/Market Commentary
By eFXdata  —  Mar 28 - 09:04 AM

Synopsis:

Credit Agricole elaborates on their optimistic outlook for the AUD/NZD currency pair, amidst a backdrop of external challenges influencing the Australian dollar, such as rising U.S. Treasury yields, a strengthening USD, and weakening iron ore prices. The bank holds a long position in AUD/NZD, targeting a movement towards 1.12, citing various factors that favor the Australian currency over the New Zealand dollar.

Key Points:

  • External Factors Impacting AUD: Higher U.S. Treasury yields, a robust USD, and declining iron ore prices are identified as significant external pressures on the Australian dollar.

  • Optimistic AUD/NZD Outlook: Despite the challenges facing the AUD, Credit Agricole remains bullish on AUD/NZD, leveraging a positive view of the Australian economy through this currency pair and targeting a move towards 1.12.

  • Influences on AUD/NZD: The firm notes declining dairy prices, which counterbalance the effects of falling iron ore prices on the AUD/NZD cross. Additionally, deteriorating business confidence and activity in New Zealand, alongside comments from RBNZ Governor Adrian Orr hinting at a return to "normalized rates," have negatively impacted the NZD, further supporting the bullish AUD/NZD position.

Conclusion:

Credit Agricole reaffirms its bullish outlook on the AUD/NZD pair, despite external pressures challenging the AUD. The bank's long position is underpinned by various factors, including relative commodity price movements and central bank commentary, which collectively support a forecasted rise in the currency pair towards 1.12. This stance offers an insightful perspective on leveraging cross-currency pairs to navigate and benefit from differing economic and market dynamics between Australia and New Zealand.

Source:
Crédit Agricole Research/Market Commentary
By Justin Mcqueen  —  Mar 28 - 06:45 AM
  • EUR/GBP -0.15%, 55DMA (0.8552) support holds for now

  • Further support below at 0.8530 (pre-BoE level)

  • A break below would negate the Mar 21 bullish key day reversal

  • Likely paves the way for a retest of the 0.85 handle

  • EU/UK 10yr yield spread less supportive of EUR/GBP. Now -165bps from -154bps

  • Potential false break of 200DMA in GBP/USD is a worry for EUR/GBP bulls

  • BoE's Haskel remains hawkish. However, actions speak louder

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Martin Miller  —  Mar 28 - 06:15 AM
  • Dollar gains as inflation data looms; yen on intervention watch nL2N3G60G7

  • Japan repeats verbal warning to yen bears, BOJ dovish tone nL2N3G60AQ

  • Japan authorities will struggle to stop yen falling nL2N3G40PL

  • USD/JPY has seen a 151.25-55 range, according to EBS data, on Thursday

  • USD/JPY chart remains bullish, expect a 152.00 break nL2N3G60ME

  • 152.00 barrier expiries clear the way for USD/JPY gains next week

  • USD/JPY and EUR/JPY pairs maintain a strong positive correlation

Source:
Refinitiv IFR Research/Market Commentary
By Martin Miller  —  Mar 28 - 05:00 AM
  • USD/JPY hit a new 2024 high at 151.97 on Wednesday

  • Scope grows for an eventual break above the 152.00 psychological level

  • Spot continues to trade well above daily kijun line, that is at 149.23

  • 14-day momentum turned positive last week, highlighting the upside bias

  • EUR/JPY has seen a 163.26-163.95 range, on Thursday, EBS data shows

  • USD/JPY Trader TGM2336. Previous update nL2N3G50LS

Source:
Refinitiv IFR Research/Market Commentary
By Richard Pace  —  Mar 28 - 04:05 AM
  • Defence of well touted 152.00 barrier options helping to cap USD/JPY

  • However, there's talk that several of these options will expire next week

  • Soon-to-expire barrier options typically field the biggest defence

  • There will also be those who stand to benefit if they are erased pre expiry

  • Market is short gamma above 152.00 which could fuel gains/volatility above

  • Higher risk of intervention makes 153 barriers a much harder-to-reach target

  • FX option implied volatility higher - 1-month 7.8 vs l-term low 7.1

  • There's conflict between short gamma and intervention fears nL5N3G51G5

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Jeremy Boulton  —  Mar 28 - 04:05 AM
  • It's two years since Germany posted positive retail sales data

  • Sales fell 2.7% yy in Feb worse than the -0.8% f/c

  • The lowest estimate by any analyst polled was -1.1%

  • Traders have consistently bet on EUR/USD rising this year

  • Liquidation of $3.5bln longs helped push EUR/USD lower from 1.1047 to 1.0695

  • The liquidation of remaining bets ($6.6bln) may fuel a deeper drop

  • Traders may soon turn their back on the pound

Source:
Refinitiv IFR Research/Market Commentary
By Richard Pace  —  Mar 28 - 03:15 AM
  • There have been several option trades featuring 1.0600 strikes this week

  • 1.08-1.06 USD call spreads common with expiry dates over the next 1-2 months

  • Also, options with various types of triggers on USD call strikes at 1.0600

  • Such options would gain value amid a deeper EUR/USD decline toward 1.0600

  • Risk reversals retain a slightly firmer downside vs upside vol premium

  • However, implied volatility reverts to late 2021 lows across all expiries

  • That suggests that any deeper EUR declines will be slow and lack volatility

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By John Noonan  —  Mar 27 - 11:15 PM
  • EUR/USD opened at 1.0828 and eased to 1.0808 in early Asia

  • Bids ahead of support at 1.0800/05 cushioned the fall in thin market

  • Heading into the afternoon the EUR/USD was trading at 1.0820/25

  • The 61.8 fibo fo the Feb-March rise is at 1.0803 where daily lows are found

  • A break below 1.0800 targets the Feb 14 low at 1.0695

  • Resistance is at the 10-day ma at 1.0853 and break would ease pressure

  • Range trading likely until Friday's US PCE index

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By John Noonan  —  Mar 27 - 11:05 PM
  • AUD/USD opened flat at 0.6534 after Wall Street rally supported recovery from lows nL2N3G52FN

  • It dipped to 0.6515 following slightly weaker Aus retail sales nAZN1MPCJW

  • A trend line drawn from Oct 26 low comes in @ 0.6515 today and held again

  • USD/CNH eased from the morning high and helped to underpin AUD/USD bounce

  • AUD/USD traded to 0.6540 before settling at 0.6535

  • Resistance is at the 10-day MA at 0.6546 and a topside trend-line at 0.6614

  • A break of either 0.6514 or 0.6614 should see decent follow-through

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Mar 27 - 04:30 PM

Synopsis:

Danske Bank reflects on the Swiss Franc's recent underperformance as EUR/CHF hits its highest level since June 2023. Predicting further elevation for the currency pair, Danske maintains its outlook for 25 basis points quarterly rate cuts by the Swiss National Bank (SNB), aiming for a policy rate of 0.75% by the year's end. Despite the potential for fundamental strengths to buoy the CHF, current and anticipated rate differentials alongside higher global interest rates are expected to pose challenges for the currency in the near term.

Key Points:

  • EUR/CHF Surge: The currency pair's ascent to levels not seen since mid-2023 positions CHF as the notable laggard in recent trading sessions.

  • Monetary Policy Forecast: Danske stands by its forecast for the SNB to implement 25 basis point reductions each quarter throughout the year, reducing the policy rate to 0.75%.

  • Intervention Stance: Current expectations lean towards the SNB pausing FX interventions, with the March decision underpinning a near-term softer CHF stance.

  • Market Forces vs. CHF: Although fundamental factors may support the Swiss currency, prevailing and forecasted rate discrepancies alongside elevated global rates could challenge CHF strength.

  • EUR/CHF Outlook: Anticipating EUR/CHF to hover around the 0.98 level in the coming 1-3 months, reflecting the intricate balance between policy actions and market dynamics.

Conclusion:

The recent peak of EUR/CHF signals a period of relative weakness for the Swiss Franc, influenced by Danske's projections of continued SNB rate cuts and a temporary halt in FX interventions. Although intrinsic strengths could underlie CHF's value, the broader context of rate differentials and global interest rate trends may hinder its performance in the near future. Danske's forecast points towards a challenging yet dynamic period for the CHF, with EUR/CHF expected to remain elevated in the short to medium term.

Source:
Danske Research/Market Commentary
By Andrew M Spencer  —  Mar 27 - 11:05 PM
  • Off 0.05% near the top of a 1.2611-1.2639 range - hectic early on D3

  • UK car output climbed 14.6% in February thanks to strong domestic demand

  • Good news for both UK industry and the resilience of UK consumers

  • The Easter holiday with the key US Core PCE on Friday suggests consolidation

  • Charts; 5, 10 & 21-day moving averages ease with daily momentum studies

  • 21-day Bollinger bands expand - daily charts retain a negative bias

  • 1.2569, 38.2% of the October/March rise is initial significant support

  • A close below 1.2569 would open the door to a test of the 1.2517 2024 low

  • Close above last Friday's 1.2677 high would suggest a base is in place

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Krishna K  —  Mar 27 - 08:55 PM
  • AUD/USD -0.1% in Asia as dollar strengthens broadly ahead of long weekend

  • Weighed down by weak CNY/CNH and Fed Waller's cautious comments on rate cuts

  • Fed's Waller still sees 'no rush' to cut rates amid sticky inflation data

  • Australia retail sales rise a modest 0.3% in Feb versus 0.4% expected

  • Will add to dovish RBA rate expectations after benign inflation data Wed

  • February U.S. PCE price index data and Powell speech Fri key for direction

  • Support 0.6510, 0.6490-95, resistance 0.6545-50, 0.6580-85

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Andrew M Spencer  —  Mar 27 - 07:45 PM
  • Off 0.17% early led by the NZD after dovish RBNZ comments - GBP closed +0.1%

  • RBNZ follows the dovish Riksbank after SNB cut last week - pressure on BoE?

  • Second-tier UK data suggests risk appetite and the USD likely lead sterling

  • Long Easter weekend with the key US Core PCE Friday point to consolidation

  • Charts; 5, 10 & 21-day moving averages fall with daily momentum studies

  • 21-day Bollinger bands expand - daily charts show a clear bearish setup

  • Negative signals target a break of 1.2569, 38.2% of the Oct/March rise

  • A close below 1.2569 would open the door to a test of the 1.2517 2024 low

  • Sustained break of last Friday's 1.2677 high would suggest a base in place

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Krishna K  —  Mar 27 - 06:50 PM
  • NZD/USD offered in early Asia on increasingly dovish RBNZ rate expectations

  • RBNZ governor Orr says conditions to allow cut becoming more apparent

  • Says core inflation pressures easing, inflation expectations back on target

  • Fed's Waller still sees 'no rush' to cut rates amid sticky inflation data

  • Soft NZ economic data, U.S. economic outperformance undermine NZD

  • NZ cuts FY 2024 GDP expectations to 0.1%, down from 1.5% forecast previously

  • New Zealand consumer confidence falls as recession news hit - survey

  • February U.S. PCE price index data and Powell speech Fri key for direction

  • Break of 0.5986 Mon low opens 0.5940-50, resistance 0.6030, 0.6050

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By John Noonan  —  Mar 27 - 06:00 PM
  • AUD/USD opens flat after recovering in US on back of Wall Street rally nL2N3G52FN

  • AUD/USD bounced off trend-line at 0.6512 Wednesday and is at 0.6514 today

  • Most of the FX volatility on Wednesday was in the USD/JPY V

  • AUD/USD in a pennant with top line at 0.6614 and bottom line at 0.6514

  • Closer resistance is at the 10-day MA at 0.6546

  • Aus Feb retail sales out today with market expecting +0.4% M/M

  • AUD/USD to be influenced by moves in the USD/CNH during Asian session

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Mar 27 - 03:00 PM

Synopsis:

ING observes notable currency movements in the G10, highlighting the continued depreciation of low-yielders, especially the Swiss Franc (CHF) and Japanese Yen (JPY). With the Swiss National Bank adopting a dovish stance and no longer seeking a stronger CHF, attention shifts to JPY as USD/JPY approaches the 152 mark, a level that tests Japan's tolerance for FX intervention.

Key Points:

  • Pressure on Low-Yielders: The CHF and JPY face significant sell-offs, with CHF's underperformance attributed to a dovish SNB stance, suggesting caution in anticipating a reversal.

  • USD/JPY Testing Intervention Thresholds: USD/JPY's overnight touch of 152 continues to challenge Japan's FX intervention limits, potentially still within the "verbal intervention" range.

  • Criteria for Actual Intervention: Actual FX intervention by Japanese authorities may require a further increase in USD/JPY, possibly closer to 155, focusing on the rate of change rather than specific levels.

Conclusion:

As USD/JPY tests the boundaries of Japan's FX intervention tolerance, market participants remain vigilant for signs of potential action by Japanese authorities. With the rate of change being a critical factor, further upward movement in USD/JPY could trigger more than just verbal warnings, posing significant implications for FX markets. The situation underscores the delicate balance central banks must maintain in managing currency strengths amidst evolving global economic conditions.

Source:
ING Research/Market Commentary
By Randolph Donney  —  Mar 27 - 03:05 PM
  • USD/JPY uptrend persists, but with ever tinier new L-T highs

  • 2022's 151.94 peak eclipsed by Wednesday's 151.975 high

  • Pullback from peak was caught above Friday's 151 low

  • Friday being the last day with a new 2024 high

  • A daily range above 152 looks key to starting a fresh leg higher

  • That as a second pending bearish RSI divergence is watched

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Randolph Donney  —  Mar 27 - 02:05 PM
  • USD/JPY hit a minor new 34-yr high at 151.975 vs 151.94 2022 peak

  • Japanese officials held an emergency meeting regarding yen support plans

  • Market saw the meeting signaling MoF, BoJ hope to avert a 152 breakout

  • Post-intervention threat setback held just above Friday's 151.00 low

  • Specs betting against durable intervention, but also Fed rate cut scope

  • Also that still wide, if off 2023 peaks, Tsy-JGB ylds spreads will hold

  • Fed's Waller speech late today, PCE Fri & ISM, NFP next week now eyed

  • Hawkish data may be needed sustain a 152 breakout amid MoF pushback

  • Top-heavy daily techs and hefty spec long position possible headwinds

  • But more of an issue if US data favor Fed's 3 2024 rate cuts from June

  • And if Japanese intervention becomes actual rather than verbal

  • A 152 break could see twin Fibos by 155.20 eyed sans intervention

  • A sub-151 range could target kijun and cloud by 149.23 on Friday

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
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